Monday, March 28, 2011

Do Govt Employees need Health Insurance ?

“Why should I go for a Health Insurance if I am a Government Employee?  I am already covered by either CGHS or Medical Attendance Rules.”  This may be your thought process when you start reading this article.
But the reality is in case of an unfortunate event like you or your family members had to be admitted in a good hospital for a medical treatment, the present health schemes such as CGHS or Medical Attendance Rules might not cover the entire medical expenditure as these schemes have a cap in the form of package or schedule rates.  And the net result is you will not be reimbursed with what you had actually paid to Hospital.  Will health Insurance schemes could come in handy at these kind of situations ?
Answer for this question may not be affirmative if you had asked this question last year.  Because till last year Government norms for claiming medical reimbursement and Health Insurance claim simultaneously was bit stringent as the total of reimbursement from the government and the health insurance claim shall not exceed the package rate prescribed by the Government.  In other words there was no additional benefit in taking a health insurance policy if you are a government employee.
However, this year this condition has been relaxed.  We can claim medical reimbursement from Government as well the hospitalization expenses from the Insurance Company, provided the total claim should not exceed the actual expenditure.
Click here to go through this earlier article on GConnect about Govt orders on claiming medical reimbursement as well as insurance claim
Be an early bird:
Also most people tend to think that Health Insurance is something that they need to think about only when they grow old.
However, the fact is Health insurance premium tends to increase with age – more the age, higher the premium. So insure at a young age.  So that your insurance gets fixed at a low cost and by the time you grow old and the money become dearer, your insurance premium cost will be almost negligible.
Stay insured:
The other truth is that health insurance protects you in case you become seriously ill or meet with an accident. A sudden accident, loss of health or natural disaster can happen to anyone. Such situations can drastically alter a person’s life, causing loss of income and inability to pay bills.  So, it makes sense to stay insured
Cost of Health Insurance:
A health insurance policy not only covers the cost of financial losses when disaster strikes, but also helps you tide over emergency medical bills due to hospitalization. If you think your health insurance premium is expensive, just wait till you receive a medical bill.
Even if someone is down with jaundice or malaria and requires hospitalization for a couple of days, his hospital bill could range from anywhere between Rs 15,000 and 25,000 depending on the hospital. And in these days of rising health care costs, imagine a chronic diabetic who needs insulin injections everyday, some one who needs frequent dialysis/chemotherapy or someone who needs continuous medication to keep living.
While taking a survey of the Health Insurance premium cost, we just found that at a cost ranging from Rs. 100 to Rs 200 per member per month, a family consists of 4 members viz., husband in the age of 40, wife in the age of 36 and two kids in the age of 12 and 7, could be covered with the health insurance benefits of Rs.2 lakhs per year.  The following is the chart containing premium cost per year for a sum assured amount of Rs.2 lakhs for the family consists of 4 members as narrated above.
health-insurance-1
Please note that this is not a campaign to the insurance companies mentioned in the chart.  There may be other insurance companies which could offer good rates than the premium cost mentioned in this chart. This is just an indication to emphasize that insurance premium costs are affordable.  Readers are advised to verify the health insurance schemes offered by various companies before choosing the right one that suits them.

What are the other benefits of taking a Health Insurance policy?

The immediate benefit of taking up a Health Insurance policy is the Tax benefit that you can enjoy under section 80 D of the Income Tax Act.
Do not worry if you do not have adequate money to pay for sudden hospitalization or surgery. Your health insurance policy offers a cashless hospitalization facility. This facility is a great help since one doesn’t have to run around in the middle of the night to collect cash for paying up large deposits prior to admission.
If a person gets hospitalized all his medical expenses 30 days prior to hospitalization and 60 days post hospitalization will be covered. This includes nursing expenses, diagnostic and medical expenses, surgery, anesthesia cost, doctor’s expense, specialist fees, scanning, x-ray, ambulance expense, oxygen, operation theatre expenses, and cost of surgical appliances, room expenditure, day care expense and similar expenses.
There are few treatments which due to technological advancement are done as an outpatient, that is, you need not have prolonged hospitalization. These treatments are also covered under health insurance.
Reduced Health Insurance Cost over the period if no claim now:
If you are a non-claimant don’t think that your money is wasted. In fact, a Health Insurance policy is most advantageous to you when you do not claim for the first few years and stay insured continuously. You will not only enjoy the Income tax benefits under Section 80D of the IT Act, but also your sum insured gets increased without paying any extra premium by way of cumulative bonus. Or you can keep the sum assured constant and start paying lesser premium.

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